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Gold vs. S&P 500 ETF: Which Is For You? (source: https://docs.google.com/document/d/1A-ddwqGpqP2eM_v0eEZBjgF3EbjYgQpTlHpTJyJbkTU/edit?usp=drivesdk)

Gold vs. S&P 500 ETF: Which Is For You?

Jason Ong

Comparing gold and S&P 500 ETF (VOO) for long-term investment goals.

Investing

Key Takeaways

1

Gold acts as a defensive asset, typically spiking during high inflation or global conflict.

2

S&P 500 ETFs are productive assets, designed to multiply value over decades through compounding growth.

3

The choice depends on your timeline and risk appetite: gold for capital preservation or ETF for consistent long-term growth.

We are drawn to gold because its price increase is all over the news today. In 2024 and 2025, gold prices saw an extraordinary surge, making it look like the ultimate winner. However, a look at historical data reveals a different story. For a significant portion of the last decade, the stock market consistently outpaced gold. Deciding between the two requires looking past the recent hype to understand how each fits your specific risk appetite.

Recent Gains vs. Long-Term Growth

Price change (Source: stockanalysis.com/etf/compare/gld-vs-voo/)

Gold is a defensive asset. It often sits dormant for years, only spiking during times of high inflation or global conflict. Between 2016 and 2022, gold returns were relatively modest compared to the aggressive expansion of global tech companies. If you had invested RM200 monthly starting in 2016, an S&P 500 ETF would have been your primary driver of wealth for most of that journey. Gold only caught up due to the specific economic conditions of the last 24 months.
Period Gold Performance S&P 500 (VOO) Performance
2016-2023 Moderate Growth High Compound Growth
2024-2025 Extreme Surge Steady Growth
Table: Comparative Performance (2016-2025)

The Productivity Gap

The core difference is that an ETF is a productive asset. When you own a Boring Investment like VOO, you are profiting from the daily work of thousands of employees at companies like Apple or Microsoft. Gold just sits in a vault. It does not produce dividends or innovate. While gold protects your money from losing value, ETFs are designed to actually multiply that value over decades.

Choosing Your Financial Vehicle

If your goal is absolute capital preservation because you might need the money in two years, gold’s recent performance is tempting. But if you prefer steady, consistent growth, an ETF might be for you. Before deciding, use the Investment Comparison Calculator to see how these assets behave over different timeframes in Ringgit terms.

Your 5-Minute Action Plan

  1. Ask yourself these questions:

a. Timeframe: Will you need this money in less than 5 years?

b. Strategy: Are you chasing "recent hype" or "business profits"?

c. Capacity: Can you handle a 20% drop for the chance of a 200% gain?

  1. Action: Pick a percentage split (e.g. 90/10) that matches your answers.

  2. Execution: Set up your automated monthly transfer to your chosen platform today.

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